Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Mumbai International Airport Pvt. Ltd. Versus Commissioner of Service Tax - I Mumbai

2016 (8) TMI 1054 - CESTAT MUMBAI

Taxability of collection of development fee from the passengers – operational, management and development of airport - section 65(3c) of Finance Act, 1994 – definition of taxable service - section 65(105)(zzm) of Finance Act, 1994 – fundamental requirement of the demand of tax - Held that: - Section 67 defining value of taxable services for charging service tax says that the value of service shall be gross amount charged by the service provider for the service provided to the recipient. Since co .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

to 86392/2014 - A/88830-88832/16/STB - Dated:- 28-1-2016 - Shri M V Ravindran, Member (Judicial) and Shri C J Mathew, Member (Technical) Shri V. Sridharan, Sr. Advocate with Shri Vinay Jain, Chartered Accountant for the appellant Shri V.K. Singh, Special Counsel for the respondent ORDER Mumbai International Airport Pvt Ltd, a joint venture of GVK Airport Holdings-led consortium and Airport Authority of India, entered into operational, management and development agreement dated 4th April 2006 wit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ing international passenger at Chatrapati Shivaji International Airport with effect from 1st April 2009 for a period of 48 months. 2. The Commissioner of Service Tax, in show cause notice dated 18th April 2011, demanded a tax of ₹ 54,68,47,002/- on the development fee of ₹ 5309194199/- collected between April 2009 and January 2011. The notice was adjudicated by Commissioner of Service Tax - I, Mumbai vide order-in-original no: 65/STC-I/SKS/11-12 dated 29th February 2012. On appeal fi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Acer India Ltd and Orissa Cement Ltd v. State of Orissa & Ors AIR 1991 SC 1676 and various instructions issued by the Central Board of Excise and Customs. 3. Two more show cause notices covering the period from February 2011 to September 2011 for an amount of ₹ 10,98,55,657/- and for the period from October 2011 to February 2013 for an amount of ₹ 30,16,97,118/- dated 20th April 2012 and 18th April 2013 were also taken up for adjudication at the same time. The original authority .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

for appellant relies upon the definition of airport in section 65(3c) of Finance Act, 1994 and the taxable service in section 65(105)(zzm) to contend that the taxable activity cannot be said to have occurred as the collections are intended for future developments whereas the airport referred to in section 65(105)(zzm) is the existing airport. Drawing attention to the decision of the Hon ble Supreme Court in Consumer Online Foundation & Others v. Union of India [(2011) 5 SCC 360] it was claim .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ise & Customs, Kochi [2007 (7) STR 468) (Tri.-Bang.)] iii. Commissioner of Central Excise v. Cochin International Airport Ltd [2009 (16) STR 401 (Ker)]. 5. Learned Authorised Representative relies upon decision of the Hon ble Supreme Court in Bharat Sanchar Nigam Ltd v. Union of India [2006 (2) STR 161 (SC)] with specific reference to paragraph 80: 80. … … … … In determining the issue, however the Assessing Authorities will have to keep in mind the following princ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t as well as the passengers did not entertain the idea that they were collecting or paying a tax when transacting in the development fee and thereby seeking to counter the plea on behalf of the appellant that this levy should have the status of a tax. 6. It would appear from a perusal of the impugned order that the adjudicating authority has overlooked the fundamental requirement of a demand for tax: articulation of the authority to levy that tax and the manner in which the impugned transaction .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

o have proceeded on the assumption that he is a contributor to a law journal of review. He has specifically stated that the logic and allusions in the remand order do not convince him. We would appreciate it if the Chairman, Central Board of Excise and Customs were to direct the Zonal Members to accord some attention to the discharge of adjudication function by Commissioner in their respective jurisdiction. In our view, tax collection is normally routine but recovery of unpaid taxes dealing, as .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

transactions are not restricted to taxes and taxable consideration. A de novo adjudication following the setting aside of the original order is not to be restricted to an analysis of the decision of the remanding authority. The adjudicating authority has merely gone through the motion of discussing the various citations referred to in the remand order instead of proceeding in accordance with the direction of the Tribunal. The Tribunal had drawn specific reference to the cited judgments to enabl .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

axable service; it has proceeded on the assumption that the appellant, being a airport operator and subject to service tax, is required to pay tax on the entirety of its collection. These flaws render the notice and demand to be not tenable and the demand would fail on this count itself. 8. The tax authorized to be collected as per section 65(105)(zzm) of Finance Act, 1994 after 1st July 2010 is on service: to any person, by airport authority or any other person, in any airport or a civil enclav .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

airport as a scheduled port of call. The contractual nature of this relationship is enshrined in the ticket which provides access to the airport, process through check-in and security, space for waiting and necessary amenities and provision for boarding an aircraft. There is no assertion in the impugned proceedings that the passenger is required to effect payment for any of these activities. These facilities were available without any additional charge before the imposition of development fee a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rol of the Ministry of Civil Aviation. Air carriage was de-nationalised first and, in keeping with the evolving trend of autonomy for infrastructure sector, management of airports were consolidated under a single authority with the enactment of the Airport Authority Act, 1994. Later on, airport operators were brought into the legislative framework by incorporation of leasing mechanism. The appellant is one such. 11. Owing to this transition from being a departmental undertaking of the Government .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f financial autonomy the need for dependence on the State exchequer could not be eliminated and hence appropriate types of levies as well as restrictions on their utilization were incorporated in the statute. To be noted in particular was the control imposed on the collections that do not relate to commercial operations. The provisions of section 22 and 22A of the Airport Authority Act, 1994 should be viewed in the specific context of substitution of the constitutional funds of the Government of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tion by the passenger and perforce enforced, without consent of the passenger, through the airlines on the basis of passenger data furnished by them on a fortnightly basis. The amounts so collected were placed in an escrow account owing to the restricted scope of expenditure being specifically enumerated in section 22A of the Act. There is, therefore, a substantive difference between a charge under section 22 and levy under section 22A. It could well be said that charge under section 22 if visit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ble Supreme Court in re Consumer Online Foundation (supra) makes it abundantly clear that development fee is a levy for a future establishment. This reinforces our conclusion that there are no services being rendered for which this levy is being charged. 14. It is the contention of the Learned Authorized Representative that with the striking down of this levy in the case of the appellant, the amounts so collected do not required to be utilized in a manner prescribed in the Act and, hence, should .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n International Airport Ltd v. Commissioner of Central Excise & Customs, Kochi [2007 (7) STR 468) (Tri.-Bang.)] affirmed by the Hon ble High Court of Kerala [2009 (16) STR 401 (Ker.)] and by the Hon ble Supreme Court [2010 (17) STR J79] has again clarified that the development fee is not linked to provision of service and hence not liable to service tax. The Hon ble High Court of Kerala had observed thus: … … … Even though Airport is also rendering services to the passen .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version